Death Gratuity Calculator: Know how to calculate entitlements and more
In the event of an unfortunate death or disablement, the government has waived off the requirement of any minimum eligibility period
Death Gratuity Calculator: A person is entitled to gratuity only if he has completed five years in any organisation. But do you know this rule does not apply in case of death or disablement. In the event of an unfortunate death or disablement, the government has waived off the requirement of any minimum eligibility period. But before knowing about other important aspects, know how to calculate death gratuity. The gratuity amount depends upon the tenure of service and last drawn salary. As per the Gratuity Act, the gratuity is payable up to the date of death irrespective of whether five-years period was completed or not.
Death Gratuity Calculation Formula: It is calculated according to this formula: Last drawn salary (basic salary plus dearness allowance) X number of completed years of service X 15/26. Gratuity = n*b*15/26
Here, 'n' is the tenure of service completed in the company and 'b' is the last drawn basic salary + dearness allowance
Example to make it easy for you:
If you have worked with XYZ company for a period of 10 years and your last drawn basic salary along with dearness allowance was Rs 40000. The amount of gratuity = 10*40000*15/26 = Rs 230,769.23
Note that the time period of service is rounded-off for gratuity calculation. If the last few months in the last year of employment are more than 6 months, then it will be rounded to the next number. For eg. 10 years and 8 months will become 11 years. Up to five months the same year will be counted. For example, if the period of service is 10 years and 4 months, it will be treated as 10 years.
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Gratuity is the money that is paid by an employer to his employee in return for his services. It is governed by the Payment of Gratuity Act 1972.
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